* Nikkei down 0.8 pct, MSCI Asia ex-Japan eases 0.1 pct
* Dollar at 87.85 yen, easing from 2-1/2-year high
* Brent crude holds above $111 a barrel
By Alex Richardson
SINGAPORE, Jan 7 Asian stocks drifted down on
Monday as investors booked profits from a New Year rally that
had pushed markets to multi-month highs, although financial
stocks gained after global regulators decided to relax draft
plans for tough new bank liquidity rules.
Commodity prices mostly held steady, supported by data
showing the U.S. economy continuing on a path of slow but steady
recovery that propelled Wall Street stocks to a five-year high.
Financial bookmakers called Europe's main share indexes to
open flat or slightly lower, while S&P 500 index futures
traded in Asia eased 0.2 percent, pointing to a weaker start in
"It just seems like markets are entering a consolidation
phase after recent gains and with most markets trading at fresh
12-month highs," said Stan Shamu, market strategist at financial
spreadbetting firm IG in Melbourne.
The dollar fell against the yen, coming off a two-and-a-half
year peak it had logged against the Japanese currency as
investors adjusted to the possibility of more monetary stimulus
in 2013 from the Bank of Japan and less from the U.S. Federal
MSCI's broadest index of Asia Pacific shares outside Japan
, which had reached its highest level since
August 2011 on Thursday, eased 0.1 percent, while Tokyo's Nikkei
share average retreated after touching a 23-month high
in early trade to close down 0.8 percent.
The MSCI benchmark's financial sector sub-index
firmed after the Basel Committee of banking
supervisors agreed on Sunday to give banks four more years and
greater flexibility to build up cash buffers so they can use
some of their reserves to help struggling economies.
HSBC Holdings Hong Kong shares rose 1 percent,
while Australia and New Zealand Banking Group Ltd gained 0.6
Shares in Japanese exporters were supported by the trend of
a weakening yen, which traded around 87.85 to the dollar,
up 0.3 percent on the day, after the U.S. currency rose as far
as 88.40 yen, its highest in nearly two-and-a-half years, on
The dollar posted a gain of around 2.7 percent against the
yen last week, its biggest weekly rise in more than a year. Its
gains had accelerated after minutes from the Federal Reserve's
December meeting showed some policymakers had considered ending
the Fed's bond-buying programme as early as this year.
By contrast, many investors are now betting that Japan's new
government, led by Prime Minister Shinzo Abe, will push to
weaken the yen and drive through aggressive fiscal stimulus, and
pressure the Bank of Japan to do the same on the monetary side.
Although the dollar may pull back against the yen given the
speed of its rise over the past month, its uptrend seems likely
to remain intact, said Hiroshi Maeba, head of FX trading Japan
for UBS in Tokyo.
"My sense is that the market could still head much higher,"
Maeba said. "I think 90 yen might be reached pretty soon."
The dollar firmed against the euro, which traded around
The U.S. stock benchmark S&P 500 index closed at its
highest level since December 2007 on Friday after data showed a
steady pace of jobs growth and brisk expansion of the services
sector in the world's biggest economy.
That offered support to growth-sensitive commodities, with
copper little changed just below $8,100 a tonne, while
Brent crude oil eased a little to around $111.20.
Spot gold firmed 0.3 percent to around $1,660 an ounce.